When treasury stock is purchased for cash at more than its par value, what is the effect
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Question:
When treasury stock is purchased for cash at more than its par value, what is the effect on total shareholders’ equity under each of the following methods?
| Cash method | Par value method |
a. | Increase | Increase |
b. | Decrease | Decrease |
c. | No effect | Decrease |
d. | No effect | No effect |
Related Book For
Fundamentals of Investments
ISBN: 978-0132926171
3rd edition
Authors: Gordon J. Alexander, William F. Sharpe, Jeffery V. Bailey
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